Generating cash is essential for any business, but not all cash-rich companies are great investments. Some produce plenty of cash but fail to allocate it effectively, leading to missed opportunities.

Not all companies are created equal, and StockStory is here to surface the ones with real upside. That said, here are two cash-producing companies that excel at turning cash into shareholder value and one that may struggle to keep up.

One Stock to Sell:

Masco (MAS)

Trailing 12-Month Free Cash Flow Margin: 12.3%

Headquartered just outside of Detroit, MI, Masco (NYSE: MAS) designs and manufactures home-building products such as glass shower doors, decorative lighting, bathtubs, and faucets.

Why Are We Out on MAS?

1. Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
2. Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 1.7%
3. Eroding returns on capital suggest its historical profit centers are aging

At $78.70 per share, Masco trades at 18.4x forward P/E. Read our free research report to see why you should think twice about including MAS in your portfolio.

Two Stocks to Watch:

CECO Environmental (CECO)

Trailing 12-Month Free Cash Flow Margin: 1.1%

With roots dating back to 1869 and a focus on creating cleaner industrial operations, CECO Environmental (NASDAQ: CECO) provides technology and expertise that helps industrial companies reduce emissions, treat water, and improve energy efficiency across various sectors.

What Makes CECO Stand Out?

1. Impressive 19.9% annual revenue growth over the last two years indicates it’s winning market share this cycle
2. Projected revenue growth of 83% for the next 12 months is above its two-year trend, pointing to accelerating demand
3. Share repurchases over the last two years enabled its annual earnings per share growth of 23.6% to outpace its revenue gains

CECO Environmental is trading at $78.53 per share, or 38.1x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.

S&P Global (SPGI)

Trailing 12-Month Free Cash Flow Margin: 33.3%

Tracing its roots back to 1860 when it published the first railroad industry manual, S&P Global (NYSE: SPGI) provides credit ratings, market intelligence, commodity data, automotive analytics, and financial indices that help investors and businesses make decisions.

Why Do We Watch SPGI?

1. Annual revenue growth of 10.7% over the last two years was above the sector average and underscores its products and services value to customers
2. Performance over the past two years was boosted by share buybacks, which enabled its earnings per share to grow faster than its revenue
3. Market-beating return on equity illustrates that management has a knack for investing in profitable ventures

S&P Global’s stock price of $452.63 implies a valuation ratio of 24.1x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.